Summary
The International Trade Commission (ITC) will decide Thursday whether to maintain countervailing duties for imported corrosion- resistant steel. Those anti-dumping tariffs were first imposed in 1993, when nobody doubted that the U.S. steel industry was flat on its back. In its 2000 "sunset review," the ITC maintained the duties because the industry was still recovering. Now, the ITC should end those duties.
Domestic producers of corrosion-resistant steel argue today that the tariffs should remain because their operating income averaged only 2.7 percent from 2000 through 2005. Worth noting is that this six-year period included a recession and nearly two years of very sluggish economic growth, during which time the highly cyclical steel industry no doubt earned low returns. The domestic CRS industry's operating income peaked at 10 percent in 2004 and declined to 5 percent in 2005; it averaged 5.2 percent for the first half of this year. Well, by this standard of profitability, Wal- Mart would deserve protection. After all, Wal-Mart's operating income for 2004 and 2005 was a mere 3.6 percent in each year. Moreover, we don't recall any crocodile tears being shed in 2004 for Exxon Mobil's operating income, which, measured as a percentage of sales (9.4 percent), was below the average operating income of domestic corrosion-resistant steel producers (10 percent).See the full content of this document
Extract
Scrap Anti-Dumping Duties
The domestic auto industry, including three highly profitable Japanese companies (To...
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